Sustainable packaging market is estimated to be valued at USD 400.34 Bn in 2024, exhibiting a CAGR of 7.2% over the forecast period 2024-2031. Growing awareness among consumers regarding the adverse impact of non-biodegradable plastics on the environment and stringency of government regulations mandating the use of sustainable packaging are boosting demand for sustainable packaging solutions globally. Furthermore, major brand owners and retailers are also switching to sustainable packaging to meet their sustainability goals and enhance their brand image, and this is driving the market growth.
Growing Consumer Awareness
Rising consumer awareness about the harmful effects of non-biodegradable plastics on the environment boosts adoption of sustainable packaging. Many consumers now consciously choose products packed in eco-friendly materials to reduce plastic waste. This change in buying behavior is encouraging brand owners to offer sustainable packaging options.
Stringent Government Regulations
Stringent government policies prohibiting or restricting the use of single-use plastics and mandating the use of recycled content in packaging is driving the market growth. Various countries implemented bans or taxes on plastic bags and Styrofoam products to reduce plastic pollution. The regulatory push is compelling companies to shift towards sustainable alternatives.
Rising Environmental Concerns Boosts Demand for Sustainable Packaging Solutions
Governments across the globe have implemented stringent regulations to curb carbon emissions and reduce pollution. Companies are under pressure to adopt more environmentally friendly practices to comply with regulations. Many consumers are also becoming more conscious about the impact of packaging waste on the environment. Consumers prefer brands that use sustainable and recycled packaging materials. The growing awareness about plastic pollution and its adverse effects has boosted demand for biodegradable and recyclable packaging alternatives like paper, glass, aluminum and others.
Increasing Support from Major Brands and Retailers
Large brands and retailers have significant influence in the value chain. Many global brands have committed to use 100% recyclable or reusable packaging by certain deadlines and demand the same from their suppliers. Retail giants have introduced private label products focused on sustainability. Some retailers even charge fees on non-recyclable materials. The growing preference for sustainable options is compelling packaging manufacturers to innovate and develop greener solutions.
High Cost of Sustainable Materials and Packaging Production
Transitioning to sustainable packaging requires investments in R&D, machinery upgrades and process changes. Materials like bioplastics, paper and glass are relatively more expensive than single use plastics. Similarly, designing packaging solutions with optimum material reduction or utilizing post-consumer recycled content increases production costs. The additional costs are often passed on to consumers, making sustainable offerings less price competitive. This economic barrier discourages certain companies and consumers from adopting sustainable options especially in cost sensitive areas. Subsidies and incentives are needed to overcome the cost challenge.
Lack of Recycling Infrastructure in Many Regions
Poor waste management and lack of proper recycling infrastructure hampers the large scale adoption of sustainable packaging globally. Many developing nations does not have well established waste sorting and recycling systems. These lack programs to collect, segregate and process different materials after usage that dampens the recycling rates. Even developed countries face challenges due to complexity in recycling multi-layered or composite materials. The technical limitations restrict packaging designers from using advanced sustainable materials. Increased investments are crucial to build strategic recycling infrastructure particularly in emerging markets and develop new recycling technologies.
Opportunity in E-Commerce and Food Delivery Boom
The exponential growth of e-commerce and online shopping has significantly increased packaging consumption globally. However, most of the packages used are single use plastics like bubble wraps, air pillows and poly mailers that are non-recyclable and end up in landfills. These can develop lightweight, reusable and recyclable wraps, boxes and envelopes made from paper, bioplastics or other sustainable materials. Growing takeaway food delivery market relies heavily on disposable plastic containers and cutleries. Manufacturers have a chance to supply compostable and reusable food packing alternatives.
Growing Demand for Compostable Packaging
Excessive plastic packaging waste is a major problem faced by the food industry. While recycling helps to reduce virgin plastic usage to some extent, it does not provide a viable solution for soiled or contaminated packaging. Compostable packaging made from bioplastics, paper or plant-based materials provides a more effective solution as it can fully decompose into carbon dioxide, water and organic matter without leaving any toxic residues. It is increasingly being used for food containers, cups, cutleries and various post-consumption applications
*Link: https://www.coherentmarketinsights.com/market-insight/sustainable-packaging-market-5203
Key Developments
- On March 26, 2024, 3M introduced the 3M Padded Automatable Curbside Recyclable (PACR) Mailer Material. This innovative product is a padded mailer material made primarily from paper, and it is designed to be easily recycled through curbside recycling programs. It offers a sustainable alternative to traditional padded mailers, which often contain materials that are not easily recyclable.
- In 2023, Electrolux Group launched a new, sustainable packaging
- In 2023, Huhtamaki launched a sustainable flexible packaging
- In 2022, Fameccanica launched a new sustainable packaging system- Greenpackt
Key Players
Amcor Limited, Westrock Company, TetraPak International S.A., Sonoco Products Company, Smurfit Kappa Group PLC, Sealed Air Corporation, Mondi PLC, Huhtamaki OYJ, BASF SE, Ardagh Group S.A, Ball Corporation, Crown Holdings, Inc., DS Smith Plc, Genpak LLC, International Paper Company, Pcakmile, Ecoware , Greenhandle Products Private Limited, Sustainable Packaging Industries, Mpacks